1. The Contracting Parties intend to encourage and develop on the basis of balanced and mutually beneficial cooperation for each party traffic and rail traffic between the Swiss Confederation and the Republic of Austria.

This cooperation will extend in particular to the following areas:

(a)

Develop strategies for the rail transport of passengers and goods between the two states.

(b)

Exchange information on the coordination of infrastructure development and rail traffic programmes, especially for the following international links:

(i)

Geneva/Basel-Zurich-Saint-Gall-St. Margrethen-Bregenz (- Lindau-Munich) - Salzburg-Vienna (- Budapest), and Geneva/Basel-Zurich-Saint-Gall-St. Margrethen-Bregenz-Feldkirch-Innsbruck-Vienna (- Budapest)/Graz/Klagenfurt / (Ljubljana),

(ii)

Geneva/Basel-Zurich-Sargans-Buchs SG-Feldkirch-Innsbruck-Vienna (- Budapest)/Graz/Klagenfurt/(Ljubljana),

(iii)

Chur-Sargans-Buchs SG-St. Margrethen/Feldkirch-Bregenz (- Lindau-Ulm),

(iv)

Brenner axis,

(v)

Axis of Saint Gotthard.

(c)

Undertake infrastructural conditions for the future use of the pendular technique in international rail traffic between the States of the Contracting Parties on appropriate rail links.

(d)

Improving international freight traffic with a view to increasing the quality of transport, in particular by reducing transit times.

(e)

Conduct joint studies on the modernisation of railway infrastructure and the development of rail transport offers.

(f)

Exchange information on organisational, legal and technical issues, including questions relating to the status of the railway in the transport system of the States of the Contracting Parties.

Within the framework of their competences, the Contracting Parties shall endeavour to cooperate in the future development of the railway infrastructure, its interoperability, rolling stock and the principles of the organisation of rail traffic. This cooperation relates in particular to:

(a)

The proposed modernisation for rail links on the lines:

(i)

Saint-Gall-St. Margrethen-Bregenz-Lochau (- Lindau),

(ii)

Sargans-Buchs SG-Feldkirch,

(iii)

Sargans-Buchs SG-St. Margrethen-Saint-Gall,

(iv)

Bregenz-Feldkirch-Bludenz;

(b)

The development of rail traffic through measures which are necessary to modernise and make compatible the technical installations of the railway infrastructure and the operational exchange of information, as well as measures Organizational and administrative.

2. In accordance with the legal requirements applicable in their States, the Contracting Parties shall support the cooperation of railway undertakings in their national territories and depart from the principle that the details of such cooperation, In particular the various joint projects, are agreed by the railway undertakings.

3. Within the limits of their powers, the Contracting Parties shall be responsible for the financing of the measures to be carried out in their territories, subject to national procedures concerning decisions on financing. In particularly justified isolated cases, it is possible to envisage, in derogation from the principle of territoriality, extra-territorial co-financing of infrastructure improvements in the area near the border if both Contracting Parties shall agree on such a procedure.

The national planning and the objectives of the BODAN-RAIL 2020 project for the large Lake Constance region will serve as a planning basis for the contracting parties. The latter will work, as part of their expertise, to ensure that the first parts of this project are completed by 2010.

2. Priority shall be given to the development of the Saint-Gall-St. Margrethen-Bregenz section with a view to reducing the defining time to 30 minutes, in particular by reducing the length of the border crossing at St. Margrethen to 1-2 minutes. The Contracting Parties also support efforts to ensure that rolling stock can move freely on the Saint-Gall-St. Margrethen-Bregenz-Lindau/Wolfurt transfrontier line.

The Feldkirch-Buchs SG rail link shall be the subject of a comprehensive study in cooperation with the Principality of Liechtenstein in order to coordinate the necessary measures and, where appropriate, to settle them by a specific agreement Tripartite.

1. The implementation of this Agreement shall be entrusted to a Steering Committee composed of representatives of the Contracting Parties which shall meet at least once a year. Depending on the needs, the representatives of the local authorities and the railway undertakings concerned will be able to be consulted.

(2) Each Contracting Party may require the convening of the Steering Committee if it considers it necessary. In this case, the steering committee is to meet within three months.

The Steering Committee shall monitor the implementation of this Convention and shall draw up a programme of implementation. It shall submit proposals on the possible development of the objectives and measures which will be established, where appropriate, as supplements to this Convention.

All information and results of the work exchanged and processed under this Agreement shall be published only with the agreement of both Contracting Parties.

1. This Agreement shall enter into force on the first day of the second month following the signature.

2. It is concluded for an indeterminate period.

(3) It may be terminated at any time in writing by a Contracting Party and, in that case, shall lapse six months after the day on which the termination is received.

Done at Bern, on 27 October 2003, in two originals in the German language.